If Southwest Development Company is a 50-50 partnership of Merideth Harper and Christopher Black,: (Select the best answer below.) A. Ms. Harper has unlimited liability, which means creditors can claim against her personal assets. B. Ms. Harper has limited liability, which guarantees that she cannot lose more than the $25,000 she invested. C. Ms. Harper has unlimited liability, which means creditors can only claim against the $25,000 she invested. D. Ms. Harper has limited liability, which is $30,000, or half of the $60,000 in unpaid debts.

Question

Tony Black

Business

22 April, 03:31

If Southwest Development Company is a 50-50 partnership of Merideth Harper and Christopher Black,: (Select the best answer below.) A. Ms. Harper has unlimited liability, which means creditors can claim against her personal assets. B. Ms. Harper has limited liability, which guarantees that she cannot lose more than the $25,000 she invested. C. Ms. Harper has unlimited liability, which means creditors can only claim against the $25,000 she invested. D. Ms. Harper has limited liability, which is $30,000, or half of the $60,000 in unpaid debts.

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Answers (1)

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Jayson Glenn · Answer 1

The answer is: A) Ms. Harper has unlimited liability, which means creditors can claim against her personal assets.

Explanation:

One of the most important characteristic of a partnership is unlimited liability. That means that in case the partnerships goes bankrupt, the partners are responsible for paying the partnership's debt even with their own personal assets.

If one partner doesn't have enough assets to meet his share of the debt, the other partner (or partners) can be held liable for the unpaid debt.